M/s Chalasani Constructions Pvt Ltd, Hyderabad V. The ACIT, Circle-2(1), Vijayawada

ITA 500/VIZ/2007

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7272 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 3 year(s) 1 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 17-01-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 14-12-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T L PETER
• Assessee Lawyers: S RAMA RAO
• Keywords: Opportunity of being heard
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM. BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI B.R.BASKARAN, ACCOUNTANT MEMBER. I.T.A. NO.500 /VIZAG/200 7 ASSESSMENT YEAR : 2002 - 03 CHALASANI CONSTRUCTIONS PVT LTD , ACIT , CIRCLE - 2(1) , VIJAYAWADA . VS. VIJAYAWADA. PAN : AABCC7273K APPELLANT. RESPONDENT. ASSESSEE BY : SHRI S RAMA RAO, ADV. RESPONDENT BY : SHRI T L PETER, CIT - DR O R D E R PER SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE CIT(A) ON VARIOUS GROUNDS WHICH ARE AS UNDER: 1. THE ORDER OF THE LD CIT(A) IS ERRONEOUS BOTH ON FACTS AND IN LAW TO THE EXTENT IT IS PREJUDICIAL TO THE APPELLANT. 2. THE LD CIT(A) ERRED IN DISPOSING THE APPEAL BASED ON THE COMMENTS OF THE AO WITHOUT PROVIDING A COPY OF THE REPORT TO THE APPELLANT. 3. THE LD CIT(A) OUGHT TO HAVE CONSIDERED THE EXPLANATIONS SUBMITTED BEF ORE HIM IN THE VARIOUS WRITTEN SUBMISSION FILED BY THE APPELLANT AND HELD THAT THE ADDITIONS MADE BY THE AO ARE NOT JUSTIFIED. 4. THE LD CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS.75,000/ - OUT OF RS.2,75,000/ - MADE BY THE AO AS UNDERSTATEMENT OF RECEIPTS FROM SRI K KOTESWARA RAO. 5. THE LD CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS.1,10,000/ - OUT OF RS.3 LAKHS ADDED BY THE AO AS UNDERSTATEMENT OF RECEIPT FROM SRI D PREMASAGAR. 6. THE LD CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS.2,91,000/ - AS UNDERSTATE MENT OF RECEIPT IN THE CASE OF Z SATYANARAYANA . 2 2. BRIEF FACTS, BORNE OUT FROM THE RECORDS ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS REQUIRED TO FURNISH COMPLETE ADDRESS OF ALL PERSONS TO WHOM FLATS WERE SOLD IN THE PREVIOUS Y EAR RELEVANT TO THE ASSESSMENT YEAR 2002 - 03 AND DETAILS OF CONSIDERATION OF EACH FLAT AND OTHER JOB CONTRACTS RECEIVED BY THE ASSESSEE. THESE DETAILS WERE FILED BY THE ASSESSEE AND AFTER PERUSAL, THE AO HAS SUMMONED SHRI K KOTESWARA RAO, SHRI D PREM SAGAR AND SHRI Z SATYANARAYANA AND RECORDED THEIR STATEMENTS. AFTER RECORDING THEIR STATEMENTS, THE AO RECONCILED THE PAYMENTS TOWARDS SALE CONSIDERATION AND JOB CONTRACTS WITH REFERENCE TO THE SALE CONSIDERATION AND JOB CONTRACTS RECEIPTS ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS AND MADE ADDITION OF RS. 2,91,000/ - , RS.2,75,000/ - AND RS.3,00,000/ - AS AN EXCESS RECEIPTS FROM Z SATYANARAYANA , K KOTESWARA RAO AND D PREMSAGAR, RESPECTIVELY. AO HAS ALSO NOTICED THAT ASSESSEE HAS ALSO RECEIVED ADVANCE FOR FLATS FROM S HRI K V SARMA, SHRI P S CHANDRA RAO, SHRI P AJAY KUMAR, SMT K SRIDEVI, SHRI Z SATYANARAYANA, SHRI D PREM SAGAR, SHRI B VENKATESWARA RAO & K SAVITRAMMA. HE HAS ALSO SUMMONED THESE PERSONS AND RECORDED THEIR STATEMENTS. BEING NOT CONVENIENCED WITH THEIR EX PLANATION STATEMENTS, HE MADE THE FOLLOWING ADDITIONS U/S 68 OF THE INCOME TAX ACT. : SRI KV SARMA RS. 2,89,780 - 00 SRI PS CHANDRA RAO RS. 98,000 - 00 SRI P AJAY KUMAR RS. 7,44,000 - 00 SMT K SRIDEVI RS. 5,53,000 - 00 SRI Z SATYANARAYANA RS. 5,47,002 - 00 SRI D PREM SAGAR RS. 6,50 ,000 - 00 SRI B VENKATESWARA RAO & K SAVITRAMMARS. 13,08,068 - 00 3. ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) BUT DID NOT FIND FAVOUR WITH HIM. NOW THE ASSESSEE HAS PREFERRED AN APPEAL BEFORE THE TRIBU NAL WITH THE SUBMISSION THAT HE HAS FURNISHED THE RECONCILIATION STATEMENT ALONG WITH THE DOCUMENTARY EVIDENCES BEFORE THE CIT(A), BUT HE DID NOT EXAMINE THE SAME AND HAS CONFIRMED THE ADDITIONS. 4. THE LD COUNSEL FOR THE ASSESSEE HAS ALSO ADMITTED THAT A LL THESE EVIDENCES COULD NOT BE FILED BEFORE THE AO BECAUSE HE HAS INITIATED THE PROCEEDINGS AT THE FAG END OF THE FINANCIAL YEAR. IN SUPPORT OF HIS CONTENTION, HE HAS DRAWN OUR ATTENTION TO THE FACT THAT ON 28.03.2005 THE AO PROPOSED THE ADDITION AND THE ASSESSMENT ORDER WAS PASSED ON 31.03.2005. THEREFORE, ASSESSEE DID NOT HAVE SUFFICIENT TIME TO RECONCILE THE DISCREPANCIES POINTED OUT BY THE AO. HE HOWEVER, FILED THE RELEVANT EVIDENCES BEFORE THE CIT(A) BUT THE CIT(A) DID NOT EXAMINE THE SAME AND CONF IRMED THE ADDITIONS. THE LD COUNSEL FOR THE ASSESSEE, FURTHER STATED THAT IF AN 3 OPPORTUNITY IS PROVIDED, HE WILL EXPLAIN ALL THE DISCREPANCIES POINTED OUT BY THE AO ALONG WITH DOCUMENTARY EVIDE NCES. THE LD DR DID NOT OBJECT TO THIS PROPOSITION AND HAS AL SO AGREED THAT LET THE MATTER BE SENT BACK TO THE AO TO RE - ADJUDICATE ALL THE IMPUGNED ISSUE IN THE LIGHT OF THE EVIDENCES FILED BEFORE THE CIT(A). 5. IN THE LIGHT OF THESE FACTS, WE ARE OF THE VIEW THAT IN ORDER TO MEET THE ENDS OF JUSTICE, THE MATTER SHOULD BE REMIT TED BACK TO THE FILE OF THE AO FOR THE RE - ADJUDICATION OF THE IMPUGNED ISSUES. WE ACCORDINGLY, SET ASIDE THE ORDER OF THE CIT(A) AND REMIT THE MATTER BACK TO AO RE - ADJUDICATE ALL THE IMPUGNED ISSUES IN THE LIGHT OF THE EVIDENCES FILED BEFOR E THE CIT(A) AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. PRONOUNCED ACCORDINGLY IN THE COURT ON 20/01/2011. SD/ - SD/ - (B.R. BASKARAN) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICI AL MEMBER VISAKHAPATNAM, DATED: 20 TH JANUARY, 2011 *MSB/UDC COPY OF ORDER IS FORWARDED TO : 1. SHRI S RAMA RAO, ADVOCATE, FLAT NO.103, HOUSE NO.3 - 6 - 542/4, INDIRADEVI NILAYAM, STREET NO.7, HIMAYATNAGAR, HYDERABAD 500 029. 2. ACIT, CIRCLE - 2(1), VIJAYA WADA. 3. CIT, VIJAYAWADA. 4. CIT(A), VIJAYAWADA. 5. DR, ITAT, VISAKHAPATNAM. 6. GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM.